Culture drives everything and could be retrogressive or progressive. Retrogressive culture guarantees scandals and failures while progressive culture brings success, growth and longevity.
The statements:
(a) “organizations hire for technical competencies and retain for attitudes”
and
(b) “culture eats strategy for breakfast” (unknown author) are reminders of the importance of core values and culture fits at both personal and corporate levels.
Culture and Shared Values (alias Core Values) are part of the McKinsey’s 7S Model influencing the company’s
(a) success or failure,
(b) growth or stagnation,
(c) longevity or extinction.
All the 7S elements must be tightly interconnected in design and operation to strengthen organizational resilience to withstand storms and maximize opportunities. Strong shared values, buy-in by and real-life practices by staff help to build strong corporate culture.
What Is Shared Value?
Shared Values are ideals, philosophies, beliefs or principles of what an entity (corporate or individual) stands for and wants to be perceived by others.
In most organizations, shared values are written down and expressed in not more than six headlines. Examples mostly found are:
(i) Integrity,
(ii) Customer Focus,
(iii) Creativity & Innovation,
(iv) Professionalism,
(v) Passion & Commitment,
(vi) Teamwork.
Every organization expects its staff to take personal and collective responsibilities to think, behave, act and express themselves according to the shared values in order to deserve or earn what they expect from their stakeholders.
Robust corporate policies, business processes, procedures and mechanisms for performance monitoring, feedback, reporting and rewards are key.
The real challenge is matching actions with words ensuring that the real daily practices across the three lines of defense functions are consistent with the theories.
Traits that are incongruent to the corporate shared values and culture are detectable during hiring and can be promptly nipped in the bud by not progressing the recruitment interview for the specific applicants affected.
Deviations missed but spotted after hiring can be addressed through sanctions, counselling, coaching and formal training.
Strong leadership style or tone at the top at governance, management and assurance levels is key to ensuring that role models inspiring consistency between the moods in the middle and buzz at the bottom are consistent with the shared shares and expected culture.
The regular daily supervision by first line of defense, continuous control monitoring by second line of defense and periodic audits by third lines of defense collectively contribute to insights into corporate culture gaps and strengths.
A formal culture audit is still critical and should be a key element in the internal audit universe and plans.
Sometimes HR takes responsibility for formal culture audits. In this case, no need for internal audit to reinvent the wheels conducting a fresh audits and repeating the same things Hr had done..
Internal Audit can seek to rely on the work of HR by validating the adequacy of the culture audit processes followed by HR, results and reports to identify gaps, strengths and advise on improvements to reduce audit fatigue and cost.
When last was a formal culture audit done in your organisation?
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